Hesitation to buy electric car is coming down with the availability of more models and charging stations in many of the developed countries. The fear of "what if my car runs out of the battery" had kept many car buyers away from buying electric cars. With the improvement in range, battery technology, charging technology and availability of charging stations is keeping that fear away. Tesla did great amount of work in making electrical vehicle technology takeoff successfully by braving the initial launch failures. They did a basic remodelling of vehicle design to suit for a battery powered electric motor and keeping most advanced automotive driver assistance systems in mind.
With the plenty of new launches all over the world, electric vehicle market is taking on gasoline vehicles. IHS Markit forecasted electric vehicles will make up as many as 8 out of 10 new cars sold in 2050. The factors influencing the increase in sales is due to greater scale in manufacturing, improvement in batteries both in terms of performance and cost.
In other related findings IHS Markit reports the cost of a lithium-ion (Li-ion) battery has already fallen 82% from 2012-2020 and by 2023, the cost of a battery will have declined 86% (by $580/kWh) in a decade. IHS Markit expects that the biggest contributor to falling battery cell costs throughout the coming decade will be reductions in manufacturing costs through larger factory sizes and improving economies of scale. Reductions in material costs by improving efficiencies and adopting lower cost cathode compositions, and improvements in battery energy density are also expected to play a role.
IHS Markit finding says "Among the three major Li-ion battery cells—Nickel Manganese Cobalt (NMC), Nickel Cobalt Aluminum (NCA) and Iron Phosphate (LFP)—LFP has already fallen below the $100/kWh threshold in 2020. All three types are expected to be below the $100 mark by 2024. " LFP will remain the lowest cost option throughout the next ten years. However, NMC and NCA will continue to command a majority share of the automotive and transport sector on account of their higher energy density, as per IHS Markit.
Irrespective of increasing usage of electric vehicles, petrol/diesel powered vehicles will not go away that immediately. With the decrease in their sales, gasoline vehicles will have a two third of presence on the road in 2050, according to IHS Markit.
IHS Markit Vice Chairman Daniel Yergin says “Oil is no longer the unchallenged king in automotive transportation. But for some time to come its writ will still extend quite widely across the realm of transportation” ..
“At least for now, the demand for electric vehicles is largely coming not from consumers, but from governments whose evolving policies are shaped by climate concerns as well as by urban pollution and congestion,” Yergin observes.
Electric vehicles are going to create a huge demand for lithium batteries, and it could rise 1,800% by 2030 and would represent about 85% of total world demand, as per IHS Markit. IHS Markit alerts demand for cobalt, another essential element in batteries, could rise 1,400 percent. And more than 50% of global cobalt supply comes from one place the Democratic Republic of the Congo, creating new material challenges for the industry .
The average cost of a lithium-ion (Li-ion) battery cell, used to power electric vehicles and to provide flexibility in the power grid as more renewables, such as solar and wind, are added will fall below $100 per kilowatt hour (kWh) in the next three years, according to a new analysis by IHS Markit. The average cost of a li-ion cell is expected to decline further through the end of the decade, to as low as $73/kWh in 2030.